Series B Preferred Stock

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

SERIES B PREFERRED STOCK

8. SERIES B PREFERRED STOCK

Series B Preferred Stock

The Company has designated 1,000,000 shares of its preferred stock as Series B Preferred Stock. Each share of Series B Preferred Stock has a stated value of $1. Each share of the Series B Preferred Stock is convertible into 1,000 shares of the Company’s common stock. The Series B Preferred Stock shall have no voting rights until January 1, 2022 when it will be on an as converted basis (subject to limitations) and liquidation preference for each share of Series B Preferred Stock at an amount equal to the stated value per share.

During January 2021, the Company issued 132,000 shares of its Series B Preferred Stock in full payment of consulting service accounts payable totaling $343,600. As a result of this transaction, the Company recorded a non-cash gain of $211,600.

During January 2021, the Company issued 92,982 shares of its Series B Preferred Stock in full payment of consulting service accounts payable totaling $156,885.

During January 2021, the Company issued 172,982 shares of its Series B Preferred Stock in full payment of trade accounts payable totaling $172,982.

During January 2021, the Company issued 566,000 shares of its Series B Preferred Stock to five parties for consulting services to be performed during the first and second quarters of 2021 related to the potential merger transaction discussed in Note 1.

As of March 31, 2021 and December 31, 2020, the Company has 963,964 shares of Series B Preferred Stock outstanding.

The Series B Preferred Stock has been classified outside of permanent equity and liabilities since it embodies a conditional obligation that the Company may settle by paying the monetary value in cash upon a liquidation event due to the liquidation preferences of the Series B Preferred Stock based upon its designation.